Assume today is t=0. A 10-year fixed rate bond with a 5% coupon rate is selling at par (annual coupons). From $200 FV of this bond, we form a floater and an inverse floater by equally splitting its face value. The floater's coupon rate is LIBOR. At t=0, duration of the fixed rate bond is 8.11. a) What is the duration of the floater at t=0? b) What is the price of the inverse floater at=0? c) What is the duration of the inverse floater? d) Now consider the range of YTMs the fixed rate bond can have one year from now. Create a table by calculating the potential prices by varying the YTM between 1% and 10% and fill in the table. Price per 100 FV Price per 200 FV P(Floater) P(IF) Yield 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% e) Plot the price-yield curve for the fixed rate bond and inverse floater on the same graph. Comment on their price sensitivity to changing yields.